Assume that the expected value method determines a transaction price of $60,000 and most likely amount method determines a transaction price of $50,000. What effect will recording revenue based on the expected value method have relative to the most likely amount method?A.)Revenue will be higher and expenses will be higherB.) Revenue will be higher and expenses are unaffectedC.) Revenue will be lower and expenses will be lowerD.) Revenue will be lower and expenses are unaffectedE.) Revenue and expenses will be the same

The price under expected value method is $60,000 that is higher than the most likely amount method…

Assume that the expected value method determines a transaction price of $60,000 and most likely amount method determines a transaction price of $50,000. What effect will recording revenue based on the expected value method have relative to the most likely amount method?

Assume that the expected value method determines a transaction price of $60,000 and most likely amount method determines a transaction price of $50,000. What effect will recording revenue based on the expected value method have relative to the most likely amount method?

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter12: Financial Statements, Closing Entries, And Reversing Entries

Section: Chapter Questions

Problem 1QY: What is the term used for the profit on a sale before any operating expenses have been deducted? a....

See similar textbooks

Related questions

Q: Gross profit is equal to Select one: a. revenues - expenses b. sales - cost of goods sold c.…

A: The income statement is prepared to find the net income or losses incurred during the period.

Q: The possible answers for option D are:Cost of Goods SoldDepreciation ExpenseEarned RevenueIncome Tax…

A: Step1:The likely income statement account that will be used to adjust unearned revenue (balance…

Q: Which should be subtracted from the net income when using the indirect method? A. Loss on sale of…

A: A cash flow statement is a financial statement that summarizes the cash and cash equivalents…

Q: I thought for an Income Statement you only need serivce revenue, subract expenses and then you get a…

A: Income statement - It is a type of financial statement which displays the Revenue and Expenses…

Q: Which of the following is not an example of an operating expense? Select one: a. Salaries Expense…

A: Option d is the correct answer.

Q: During the current year, Giatras Electronics recorded credit sales of $710,000. Based on prior…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: Listed below are several information characteristics and accounting principles and assumptions.…

A: Stable-dollar assumption (do not use historical cost principle). Monetary unit assumption Earning…

Q: A decrease in Selling and Administrative Expenses woulddirectly impact what ratio?a. Fixed asset…

A: Answer:

Q: Select all the items that are not relevant for decision making from the list below: A. Loss…

Q: Question: What is the formula for calculating the net profit margin? a. Net Profit / Revenue b.…

A: The income statement is prepared to record the revenue and expense of the current period. The income…

Q: Using accrual accounting, when is revenue recognized? A. When cash transfers B. When the…

A: There are two type of accounting merhods used in business. One is cash basis of accounting and other…

Q: As per double entry rules, when will you DEBIT? a. If there is decrease in asset b. If there is…

A: Debit Credit Assets Increase Decrease Liabilities Decrease Increase…

Q: a. What is your company’s primary revenue, secondary revenue, and gains? b. What is your company’s…

A: As per guidelines. we can only answer up to 3 subparts. Kindly corporate and ask other subparts as a…

Q: If the seller is paid after delivery of goods or services and the time value of money is viewed as…

A: If the seller is paid after the delivery of goods or services and the time value of money is viewed…

Q: 5- The ratio of Profit Before Tax Assets is known as? a-Net Profit after Taxes b-Return on assets…

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: efore the number. 11. Revenue result in increase in equity ar herefore has a credit normal balance.…

A: The answer is stated below:

Q: Fraud Investigators Incorporated operates a fraud detection service. a. On March 31, 10 customers…

A: Accounts Receivable -Accounts Receivables are the customers to whom sales are made but the amounts…

Q: Owner's equity Select one: a. The resulting amount when total liabilities are subtracted from total…

A: We know that the accounting equation is Assets = Liabilities + Shareholders Equity That is we can…

Q: Indicate the effect of the transactions listed in the following table on total current assets,…

A: Entry for Merchandise sold for cash is : Cash a/c Dr XXX To Sales a/c Cr XXX

Q: Which of the following accounts are characterized as a "contra" account? (Select ALL tha apply) O…

A: Contra account: Contra effect of the transaction recorded on the opposite side

Q: Which of these expressions is correct? (A Profit plus operating expenses = sales B all of these are…

A: The gross profit is calculated as difference between sales and cost of goods sold. The net income…

Q: Revenue Expenditures are Select one: O a. Short-life and must always be replaced to generate revenue…

A: The expenditures can be defined as revenue and capital expenditure.

Q: (Choose the correct alternati Column I Column II A Current Account Surplus i. Receipts Payments C…

A: The current account surplus is excess of receipt over the payments.

Q: Which of the following statement is False for a Simple-Step Income Statement? a. Total expenses…

A: An income statement is one of the financial statements of a company which is prepared at the end of…

Q: Presented below are the assumptions, principles, and constraint used in this chapter. 1. Economic…

A: Going concern assumption: The going concern assumption emphasizes on the longevity of the company's…

Q: Other things held constant, which of the following will DECREASE the current ratio, assuming an…

A: Lets understand the meaning of current ratio. Current ratio compares current asset with the current…

Question

100%

A.)Revenue will be higher and expenses will be higher

B.) Revenue will be higher and expenses are unaffected

C.) Revenue will be lower and expenses will be lower

D.) Revenue will be lower and expenses are unaffected

E.) Revenue and expenses will be the same

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Revenue Expenditures are Select one: O a. Short-life and must always be replaced to generate revenue for an accounting period O b. Reduces profit O c. All the above O d. Expenses are shown in Income Summary
The balance of the Cost of Goods Sold account: a. increases when there is a sale. O b. increases when there is a purchase return. O c. decreases when there is a purchase. O d. decreases when there is a sale.
Fraud Investigators Incorporated operates a fraud detection service. a. On March 31, 10 customers were billed for detection services totaling $33,000. b. On October 31, a customer balance of $1,900 from a prior year was determined to be uncollectible and was written off. c. On December 15, a customer paid an old balance of $820, which had been written off in a prior year. d. On December 31, $580 of bad debts were estimated and recorded for the year.
The following are taken from the record of ABM Company for the year ended December 31, 20X2: DEBIT CREDIT P764,985 8,200 5,465 |Sales Purchase Discount Purchase Returns and allowances Purchases Freight-in Sales discount Sales returns and allowances Depreciation Expense Amortization expense Salaries Expense Utilities Expense Advertising Expense Rent Expense Interest Income Interest Expense Gain on sale of PPE Bad Debts Expense 459,990 9,180 13,300 5,455 25,000 10,000 80,000 55,000 35,000 60,000 5,444 5,677 5.465 ??? • Based on actual physical count, inventory balance are as follows: | January 1, 20X2 P25,455 December 31, 20X2 P20,765 • Bad debts expense is 4% of net sales. Classify the bad debt expense as general and administrative expense.
Which of these expressions is correct? (A Profit plus operating expenses = sales (B) all of these are correct C Gross profit less operating expenses = net profit (D) Sales plus cost of sales less operating expenses = net profit
I thought for an Income Statement you only need serivce revenue, subract expenses and then you get a total which is the net income?
Listed below are several information characteristics and accounting principles and assumptions. Match the letter of each with the appropriate phrase that states its application. (Items a through k may be used more than once or not at all.) Economic entity assumption g. Matching principle Going concern assumption h. Full disclosure principle Monetary unit assumption i. Relevance characteristic Periodicity assumption j. Reliability characteristic Historical cost principle k. Consistency characteristic Revenue recognition principle ____ 1. Stable-dollar assumption (do not use historical cost principle). ____ 2. Earning process completed and realized or realizable. ____ 3. Presentation of error-free information with representational faithfulness. ____ 4. Yearly financial reports. ____ 5. Accruals and deferrals in the adjusting and closing process. (Do not use going concern.) ____ 6. Useful standard measuring unit for business…
When we reduce Total expenses from Revenue , the result is called as ........... a. Cost b. Revenues c. Expenses d. Net income or Net Loss
Net income equals: Select one: a. Assets minus liabilities. b. Cash receipts minus cash payments. c. Revenues minus expenses. d. Revenues minus cost of goods sold.
A decrease in Selling and Administrative Expenses woulddirectly impact what ratio?a. Fixed asset turnover ratio. c. Current ratio.b. Times interest earned. d. Gross profit percentage.
Which should be subtracted from the net income when using the indirectmethod? A. Loss on sale of investmentB. Amortization of patentC. Increase in accounts receivableD. Increase in accounts payable
(Multiple Choice) A multi-step income statement ________. A. separates cost of goods sold from operating expenses B. considers interest revenue an operating activity C. is another name for a simple income statement D. combines cost of goods sold and operating expenses